Breach of Promise/Contract

Though many types of recognized grounds exist for recovering losses from brokers or their firms, one of the most clearly defined bases for recovering losses is a breach of promise/contract. When you enter into a relationship with a registered broker and firm, it generally begins with the signing of a contract between you and the firm. This contract includes, either directly or by operation of law, a duty of good faith and fair dealing and the broker’s and the firm’s promise to act in accordance with all rules of the Securities and Exchange Commission (SEC), FINRA, and all applicable federal and state securities laws. Thus, in most cases of violations of securities laws, a claim for recovery can also include an assertion of breach of promise/contract. For example, if your broker is committing financial fraud through bad practices such as churning or selling away, this is also considered a breach of promise/contract. These contracts are legally binding representations of your broker’s basic obligations to you, the client. If your broker or firm has violated the terms of your contract, you may have grounds to recover your resulting losses.

Along with commitments to observe all rules of the securities industry, brokerage firm contracts usually include an arbitration clause. This clause stipulates that all issues with a broker’s performance must be pursued through arbitration rather than litigation. This clause generally means that, as a result of signing the contract with your broker, you must pursue any securities law claim against the broker in arbitration. Arbitration is a way to resolve disputes outside the courts. FINRA securities arbitrations do have a six-year “eligibility period,” which makes contacting our firm promptly for a free case evaluation even more important. The time during which you may pursue a securities law claim becomes more limited every day. A swift start to the process is important to ensure you have an opportunity to pursue fully all means available to you.

At Goodman & Nekvasil we have spent decades recovering losses through securities arbitration, including complex matters such as failure to supervise claims. Particularly when you have already suffered significant damages, it is important to receive professional legal help when attempting to recover losses. Contact us now for a free consultation and explore how our legal team may be able to help.